Market Gapping Down After Yesterday's Sell-Off

By IBT Staff Reporter On 09/02/09 AT 9:41 AM

The market sold off hard yesterday and its time for investors to begin to take off size in long positions and reevaluate the landscape. The market should be preparing for a significant pull-in, but on a shorte time frame we are slightly oversold after yesterday. Look for possible reversals today for a crappy bounce. Financials led the market higher and are the first place we will begin to look for shorts as they are not grossly oversold. GS has plenty of room to the downside after holding up well in recent months. Weak stocks may be the place to go if you are looking to capture a possible small bounce today. Stocks like FSLR and POT have been hit hard even during the market rally, and could pop up. Gold (GLD) has formed a wedge that should be resolved to the upside to test the reverse head and shoulders pattern. The stock could break above neckline at 100 in the coming months and provide a great measured long. For shorts, today may be the day to take some profits before looking for another good entry short after a possible bounce.